Former U.S. Government Employees - Conflict of Interest
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1 PRO-11 Issue Date January 30, 2002 Former U.S. Government Employees - Conflict of Interest Purpose/Summary This procedure provides guidance on the laws and regulations applicable to the recruiting, and hiring of, and work performed for Boeing by current or former U.S. Government employees (military, civilian, or special). Supersedes September 12, 2001 Applies to All Boeing Maintained by Vice President of Ethics and Business Conduct Authority Reference(s) Policy POL-2, "Ethical Business Conduct" Page 1 of 9
2 Approved by Gale C. Andrews Vice President, Ethics and Business Conduct Summary of Changes to the Title Page The Issue Date and Supersedes date have changed on the title page. In addition, Section 4.A.2. has changed. 1. Introduction Most current and former U.S. Government employees, including military officers and special Government employees (as defined in Section 5 below) are subject to federal conflict of interest laws and regulations. These laws and regulations restrict how The Boeing Company may recruit and hire certain of these current and former U.S. Government employees. These laws and regulations also limit the activities that many current and former U.S. Government employees may perform for Boeing. Violation of these laws and regulations may result in substantial civil or criminal penalties as well as damage the reputation of the company. Current and former U.S. Government employees are responsible for complying with the laws and regulations applicable to them. Managers are responsible for ensuring that they are familiar with the restrictions applicable to current and former U.S. Government employees and, in particular, that employees who report to them are not assigned job responsibilities that would cause them to violate applicable laws and regulations. The Law Department is available to assist employees and managers in understanding the requirements of the laws and regulations described in this procedure. 2. General Requirements To ensure compliance with statutory and regulatory conflict of interest requirements, the company has established procedures and processes for the recruitment, selection, assignment, and reassignment of current and former U.S. Government employees. A. Recruitment Because engaging in employment discussions with certain current U.S. Government employees may lead to possible criminal penalties for the individual and civil penalties for the company, up to and including contract cancellation, no discussion concerning possible employment should occur with a current U.S. Government employee until clearance has been obtained from the People organization. The People organization has established and maintains the process for ensuring that the employment of current or former U.S. Government employees is in compliance with Page 2 of 9
3 applicable requirements. More detailed information is provided in Boeing Procedure PRO-4825, Recruiting and Hiring Current and Former Government Employees. B. Offers of Employment In addition to the limitations on engaging in employment discussions, certain current and former U.S. Government employees may have restrictions on the work they can perform if they are hired by the company or may even be prohibited from being hired by the company for a specific period. Therefore, to ensure compliance with these laws and regulations, the People organization will not offer employment to any current or former U.S. Government employee until a conflict of interest review has been conducted by the Law Department in accordance with this procedure as required by PRO-4825, Recruiting and Hiring Current and Former Government Employees. C. Contingent Labor Retaining current or former U.S. Government employees as contract labor, consultants, or in other similar capacities also must be reviewed for potential conflict of interest restrictions (see Boeing Procedure PRO-13, Consultant Agreements, and PRO-91, Utilization of Contingent Labor ). D. Work Assignment 1. Each manager, to whom a former U.S. Government employee with work assignment restrictions reports, is responsible for ensuring that such employee is not assigned any job responsibilities that would cause that employee to violate applicable laws and regulations. Employees who are current or former U.S. Government employees are ultimately personally responsible for compliance with applicable conflict of interest restrictions. 2. Employees are required to notify the People organization before they undertake an assignment as a special Government employee. Section 5 defines who is a special Government employee and highlights principal restrictions applicable to those who serve as special Government employees. A conflict of interest review must be performed by the Law Department before any employee accepts an assignment as a special Government employee. E. Education and Training The People organization has established a system by which changes of assignment and transfers of certain former U.S. Government employees are reviewed by the Law Department to ensure that such changes will not create a conflict of interest (PRO-4825, Recruiting and Hiring Current and Former Government Employees ). Page 3 of 9
4 3. Restrictions Related to Recruitment of Current U.S. Government Employees A. Matters Affecting a Financial Interest PROCEDURE PRO-11 Each current U.S. Government employee, including a special Government employee, is prohibited from participating personally and substantially as a government officer or employee in any activity in which, to such employee s knowledge, any of the following has a financial interest: 1. The employee, 2. The employee s spouse, 3. The employee s minor child, 4. The employee s general partner, 5. An organization in which the employee is serving as an officer, director, trustee, general partner, or employee, or 6. Any person or organization with whom the employee is negotiating or having arrangements concerning prospective employment, unless the employee makes full disclosure to the employee s superiors and either disqualifies himself or herself from further participation in such matters or receives a written determination exempting the employee from the requirement to disqualify himself or herself. (18 USC 208(a), (b)) B. Procurement Integrity Restrictions Each current U.S. Government employee, including a special Government employee, who (a) is participating personally and substantially in a competitive federal agency procurement in which the company is a bidder or an offeror (procurement officer) and (b) has any contact with the company about employment must file a contact report in writing with the employee s supervisor and with the designated agency ethics officer. In addition, prior to any employment discussions with the company, procurement officers must disqualify themselves in accordance with the requirements of their agency. 1. Participating personally and substantially in a competitive federal agency procurement means participating directly, including direct and active supervision of a subordinate's participation, where involvement of the individual is of significance to the matter such as through active and significant involvement in (1) drafting, reviewing, or approving specifications or a statement of work for procurement; (2) preparing or developing solicitations; (3) evaluating bids or proposals or selecting a source; (4) negotiating price or other terms and conditions of a contract; or (5) reviewing and approving award of a contract. (FAR ) Page 4 of 9
5 2. The following are not in and of themselves considered to be participating personally and substantially in a competitive federal agency procurement: a. Participating on boards, panels, or advisory committees reviewing milestones or evaluating alternative technologies or approaches; b. Performing general, technical, engineering, or scientific efforts not directly associated with particular procurements; c. Performing clerical functions; d. Participating in management studies under procedures of OMB Circular A-76. (41 USC 423(c); FAR , , (c)) 4. Postemployment Restrictions on U.S. Government Employees A. Restrictions on Former Executive Branch Employees 1. Lifetime Ban Former executive branch employees, including retired and reserve officers, are prohibited for life from making any communication to or appearance before, any officer or employee of an U.S. department, agency or court with the intent to influence the U.S. government on behalf of anyone else in connection with a particular matter involving specific parties (1) in which they were personally and substantially involved while in the government, and (2) in which the government is a party or has a direct and substantial interest, and (3) which involved a specific party or parties at the time of such participation. (18 USC 207(a)(1)) 2. Two-Year Ban Former executive branch employees, including retired officers, and reserve officers are prohibited for 2 years after leaving government service from making any communication to or appearance before, any officer or employee of any U.S. department, agency or court with the intent to influence the U.S. government on behalf of anyone else in connection with a particular matter involving specific parties (1) which they know or should know was pending under their official responsibility as a government employee during their last year of service,, (2) in which the U.S. government is a party or has a direct and substantial interest, and (3) which involved a specific party or parties at the time it was so pending. (18 USC 207(a)(2)) 3. One-Year Ban Page 5 of 9
6 a. Senior Personnel. Former high-ranking government officials (generally, military officers 0-7 and above, various grades of generals and admirals, Senior Executive Service (SES) and certain employees paid at executive service pay rates equal to or exceeding the pay of an SES-V, or appointed by the president or vice president) are prohibited for 1 year after leaving such government service from making any communication or appearance on behalf of anyone (except the United States) with the intent to influence the person s former department or agency in connection with any matter on which the person seeks official action. (18 USC 207(c)) b. Very Senior Personnel. Former very senior executive branch employees (the vice president, former executive branch employees at executive schedule level I pay rate, former executive office of the president employees at executive schedule level II pay rate, certain presidential and vice presidential appointees) in addition to the restrictions set in paragraph 3.a. are also prohibited for 1 year after leaving such government service from making any communication to or appearance before any person appointed to an executive level I through V position in any executive agency in connection with any matter for which the person seeks official action on behalf of anyone (other than the United States) with the intent to influence any officer or employee of the executive branch of the United States. (18 USC 207(d)) 4. Five-Year Ban (Executive Order dated Jan. 20, 1993) Repealed by President Clinton, effective January 20, B. Restrictions on Former Legislative Branch Employees For 1 year after leaving government service, members of congress and legislative branch employees paid at the rate of GS-17 or above are prohibited from making any communication with the intent to influence certain legislative branch employees on behalf of any other person in connection with a matter on which official action is sought. Specifically, members of congress may not lobby anywhere within the legislative branch. Elected officers are prohibited from lobbying their respective house of congress. Personal staff of congressional members may not lobby their former member or his or her employees. Committee staff may not lobby members and staff of their former committee or any member who served on that staff for 1 year prior to that employee's termination. Leadership staff and other legislative offices staff are prohibited from lobbying their former offices. (18 USC 207(e)) With respect to congressional staffers, however, these post-employment restrictions, in general, do not apply to individuals whose rate of pay was Page 6 of 9
7 less than 75% of the basic rate of pay for a member of congress, pursuant to an exception. (18 USC 207(e)(6)) C. Trade or Treaty Negotiations Any former executive or legislative branch employees or members of congress who had personal and substantial involvement in trade or treaty negotiation during that employee's or member's last year of government service, and who had access to information exempt from disclosure under the Freedom of Information Act, are prohibited for 1 year after leaving government service from representing or advising anyone (except the United States) on the basis of information concerning the negotiation. (18 USC 207(b)) D. Terminal Leave Limitations Some military officers with accumulated leave decide to begin work for the company prior to their official retirement or separation date from U.S. Government employment. This time period is often referred to as terminal leave. An individual on terminal leave cannot work for Boeing unless the individual first obtains written authorization from the individual s government supervisor and provides that authorization to the company. Also, some opinions of government ethics officials have concluded that 18 USC 205 prohibits a person on terminal leave from representing a company such as Boeing on any matter before any federal agency or employee prior to the individual s official retirement or separation date. Accordingly, anyone on terminal leave who performs work for Boeing, shall not have contact with the U.S. Government on behalf of Boeing while that individual is on terminal leave. (18 USC 203; 18 USC 205) E. Use of Nonpublic Information Former executive branch employees, including retired and reserve officers, are prohibited from using nonpublic information to further the private interests of any person, firm, or organization, whether through advice or recommendation, or by unauthorized disclosure. Nonpublic information is information that an employee gains by reason of federal employment and that the employee knows or reasonably should know has not been made available to the general public. (5 CFR ) F. Postemployment Restrictions Under Procurement Integrity 1. Procurement Integrity provides that company may not compensate former government employees for any business or employment arrangement for 1 year after those employees have performed one of the following: a. Served as the procuring contracting officer, the source selection authority, a member of the source selection evaluation board, or the chief of a financial or technical evaluation team in a procurement in which that contractor Page 7 of 9
8 was selected for an award of a contract in excess of $10 million. b. Served as the program manager, deputy program manager, or administrative contracting officer for a contract in excess of $10 million awarded to that contractor. c. Personally made a decision for a federal agency to award a contract, subcontract, modification of a contract or subcontract, or a task or delivery order in excess of $10 million to that contractor, to establish overhead or other rates applicable to a contract or contracts for that contractor that are valued in excess of $10 million, to approve issuance of a contract payment or payments in excess of $10 million to that contractor, or to pay or settle a claim in excess of $10 million with that contractor. (41 USC 423(d); FAR (c), , (d)) Note: The foregoing restrictions do not prohibit a former U.S. Government employee from accepting compensation from any division or affiliate of the company that does not produce the same or similar products or services as the division or affiliate that received the contract covered by Procurement Integrity. (41 USC 423(d)(2); FAR (d)(2)) 5. Restrictions Applicable to Special Government Employees A. Definition of special Government employee 1. Certain individuals who perform services for the U.S. Government on a temporary or intermittent basis, including reserve officers, are called special Government employees. Generally, special Government employees are retained or appointed to perform temporary duties, with or without pay, for not more than 130 days during any period of 365 days. (18 USC 202(a)) 2. However, not all individuals who advise or assist the U.S. Government by serving on advisory committees or boards are necessarily special Government employees. Someone who serves in a representative capacity (for example, on behalf of industry) may not be considered a special Government employee. The DOD generally classifies individuals serving on its advisory boards as special Government employees. The federal civilian agencies, however, do not always make a similar designation. Therefore, individuals who have been invited to serve on U.S. Government advisory committees or boards should ascertain from the agency whether they will be classified as special Government employees. B. Restrictions on Activities While a special Government employee Page 8 of 9
9 1. Generally, special Government employees are covered by the same restrictions as regular U.S. Government employees. Specifically, the restrictions outlined in sections 4.A. and 4.C (except for 18 USC 207(c), which does not apply to individuals serving less than 60 days in a calendar year,) apply to special Government employees who fall within the coverage of the statutes and regulations. 2. In addition, special Government employees, except in discharge of their government duties, may not represent anyone before a government agency in a particular matter in which the United States is a party or has an interest and in which the employee has at any time participated personally and substantially as a government employee. (18 USC 203) 3. A special Government employee may not represent anyone in any particular matter pending before the department or agency of the government in which the employee is serving if the employee has served more than 60 days during the past 365 days, regardless of whether the employee has participated personally and substantially in the matter. (18 USC 203(c)(2) and 205) 4. Finally, special Government employees are subject to the standards of ethical conduct contained in Executive Order It requires, among other things, that special Government employees not use inside information obtained as a result of their government employment to benefit themselves or the company. 6. Responsibilities The Law Department is responsible for providing guidance with respect to this procedure. Page 9 of 9
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